Almost two-thirds of music industry executives think removing digital locks from downloadable music would make more people buy the tracks, finds a survey.

The Jupiter Research study looked at attitudes to Digital Rights Management (DRM) systems in Europe music firms.

Many of those responding said current DRM systems were “not fit for purpose” and got in the way of what consumers wanted to do.

Despite this few respondents said DRM would disappear in the near future.

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The study revealed that about 54% of those executives questioned thought that current DRM systems were too restrictive.

Also, 62% believed that dropping DRM and releasing music files that can be enjoyed on any MP3 player would boost the take-up of digital music generally. However, Mr Mulligan pointed out that this percentage changed depending on which sector of the industry was answering.

Among all record labels 48% of all executives thought ending DRM would boost download sales – though this was 58% at the larger labels. Outside the record labels 73% of those questioned thought dropping DRM would be a boost for the whole market.

Among all those questioned, 70% believed that the future of downloadable music lay in making tracks play on as many different players as possible. But 40% believed it would take concerted government or consumer action to bring this about.

They’ve been talking about this in private as early as late 2006, but most likely much earlier. And it looks like changes could come within months:

Executives of several technology companies meeting here at Midem, the annual global trade fair for the music industry, said this weekend that a move toward the sale of unrestricted digital files in the MP3 format from at least one of the four major record companies could come within months.

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But behind the public posturing, there are signs of a new appreciation in the industry for unrestricted copies, which could be sold as singles or through subscription services or made freely available on advertising-supporting Internet sites.

— EMI Group last week said it would offer free streaming music on Baidu.com, the leading Web site and search engine in China, where 90 percent of music is pirated. EMI and Baidu also agreed to explore developing advertising-supported music download services. EMI this summer licensed its recordings to Qtrax, an ad-supported music distribution service.

— VirginMega and FNAC, two of the top music retailers in France, said last week that they would sell DRM-free music tracks from independent labels. DRM is a “pain in the neck” for consumers, Julian Ulrich, general manager of VirginMega, told Warren’s Washington Internet Daily, a newsletter. The 350,000 songs, Kennedy said, is a sizable amount.

— Yahoo’s experiments last year it offered a handful of tracks from Norah Jones, Jessica Simpson, Jesse McCartney and Relient K without any digital restrictions will continue this year, David Goldberg, head of Yahoo Music, said during an interview at Midem. Two of the major labels, Sony BMG and EMI, agreed to the tests in 2006.

— Amazon.com, the Internet retailer, is looking into starting a digital music download service that is DRM-free, MusicWeek magazine wrote Jan. 6.

“In 2007, the majors will get the message, and the DRM wall will begin to crumble,” the journalist Antony Bruno wrote in Billboard magazine this month.

That could change the equation for Apple, which has dominated the sales of both Internet music and digital music players. Apple does not share or license the DRM that its products use, thus restricting music sales to its own products. Apple representatives would not be interviewed for this article.

Reading the last part of the above quote, it was absolutely no surprise that this month, Apple’s CEO Steve Jobs came out playing Ghandi, pretending not to like DRM and trying to promote a DRM-free distribution of music. Charlie Demerjian basically took care of Jobs here, but allow me to have my take on it as well. Here are some quotes:

The third alternative is to abolish DRMs entirely. Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat.

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Why would the big four music companies agree to let Apple and others distribute their music without using DRM systems to protect it? The simplest answer is because DRMs haven’t worked, and may never work, to halt music piracy.

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So if the music companies are selling over 90 percent of their music DRM-free, what benefits do they get from selling the remaining small percentage of their music encumbered with a DRM system? There appear to be none. If anything, the technical expertise and overhead required to create, operate and update a DRM system has limited the number of participants selling DRM protected music. If such requirements were removed, the music industry might experience an influx of new companies willing to invest in innovative new stores and players. This can only be seen as a positive by the music companies.

So all of this begs the following questions:

Couldn’t Jobs “imagine a world where every online store sells DRM-free music encoded in open licensable formats” back in 2003? Couldn’t he see that “in such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players”?

Couldn’t he see back in 2003 that “DRMs haven’t worked, and may never work, to halt music piracy”?

Couldn’t he see how DRM free music would overall lead to more sales of music and be more positive for music companies back in 2003 when he sold out to them with iTunes?

We all know he could, because if he couldn’t he would have to be pretty retarded for someone in his position. So what happened back in 2003, Steve? In case this is all still a mystery to the reader, back in 2003 this was purely a business decision for Jobs, and it still is today when he pretends to be the Ghandi of the music industry. Jobs could care less about what users want and if DRM is good or bad, he saw an opportunity to make money including DRM in iTunes, mainly by locking out competitors, and he took it, largely ignoring issues it was causing for users. And because of that, Jobs and Apple made loads of cash in the last few years at the expense of consumers. He would have continued to do so, if it weren’t for the fact that music companies are now looking at distributing music without DRM. What this means for Jobs is that suddenly, even more companies will be able to freely distribute music, and Apple won’t be able to lock them out anymore. So before all of this happens, Jobs made a 180 degree turn and now pretends he doesn’t like DRM. And the public largely bought it too. “WOW! Steve Jobs doesn’t like DRM! Finally! Someone important on our side! Way to go Steve Jobs!” They fail to realize Jobs is just a hypocrite looking at his own interests. It’s the same thing which I discussed about Google here. The fact that Apple is now getting sued to death because of DRM in various countries around the world also helped.

Even Bill Gates sounded stupid when he admitted DRM sucked for users, and that he is against DRM that ties content to a single device, but somehow failing to notice that the technology is being included in the latest software and hardware products from Microsoft, for which he is still responsible. What?s going on exactly?

They’re all just hypocrites. And now that DRM is starting to die, I’m sure everyone at Microsoft is absolutely happy with the fact that they spent all that time crippling Windows Vista and other products with DRM “features” while it may not be used that much anymore in the future anyway. Looking at all the issues it is causing for Windows Vista now, I’m sure they’re almost bursting into tears at Microsoft right now. You could have used all that time for better purposes, huh guys? Microsoft now has to go through loads of problems because of DRM in Windows Vista and it’s backfiring heavily. Recently Bruce Schneier wrote his opinion about Windows Vista, and it doesn’t look good at all. Many users are reporting issues with Windows Vista largely having to do with DRM. And while many industry analysts were very optimistic about Windows Vista sales before its release, it’s now becoming clear that Vista is selling much less than Windows XP:

Sales of boxed copies of Windows Vista at retail stores significantly trailed those of Windows XP in each product’s first week on shelves, according to new figures from NPD.

The market research firm’s data showed the number of copies of Vista purchased was nearly 59 percent less than the number for its predecessor XP, looking at the first week of sales. Revenue was also down, but less dramatically, with the dollar value of first-week Vista sales off 32 percent from that seen with XP.

Even our beloved Steve-O told analysts recently they were a little too excited about the effect Windows Vista would have on Microsoft’s financial results for 2008. It’s no surprise that Windows Vista is doing worse than Windows XP. If you’ve been following the news for the last few months, and certainly if you’ve been reading my posts here, it was to be expected. Vista just has too much working against it right now. Most of it is discussed in my review. But problems are still being reported, largely having to do with application incompatibility. The claim has been made that Vista breaks 90% of games, and it seems to be the case indeed. I know I can’t run Quake 4 on Vista because it keeps crashing at the “loading” screen. Apart from that, hardware manufacturers are still struggling to make their drivers work in Windows Vista. Not only Creative, but also nVidia can’t yet release working final drivers for their latest products. In Creative’s case, here is why:

Creative said on the matter, “The changes to the audio implementation and subsystem were quite major, requiring a fundamental rewrite of the driver model and features to take account of the lack of direct hardware support” and continued, “Additionally, removing DirectX 3DAudio hardware support required a work-around, in the form of Creative Alchemy, which was available before Vista hit the retail shelves to restoremulti-channel EAX audio.”

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Creative also cited a change in WHQL procedures by Microsoft that have been “time consuming” and resulted in further significant delays.

Changes to the audio and video subsystem were indeed quite major in Vista. And we already know why: Because of the DRM features that were included in Vista. Peter Gutmann has all the details here.

Windows Vista is looking to become the next Windows Me at this point, but let’s hope Microsoft can do something about this in the near future. But to be honest, it doesn’t look very good and Microsoft has really made some terrible decisions with Vista that are going to cost them dearly.

Comments

4 Responses to “DRM in trouble and Windows Vista sales lacking”

I couldn’t agree with you more. Obviously the people at MS forgot that an operating-system is supposed to do things for you, not make them difficult or impossible. I don’t buy that crap offered by their appologists that claim they were bullied into it by the MPAA either. Microsoft chose to adopt the DRM model, it’s the same mindset that is for ‘trusted computing’.

In the end maybe this will serve as an example of why conspiring against your customers hurts your stock value. Probably not, they should let their coders and technologists make their business decisions as well for them.

Karel, I have read all of your Vista posts, and I must say I agree with all of them.

Having been a legal user of Windows from 3.1 all the way up to XP, I am NOT going to pay Microsoft another cent of my money. I will not upgrade to Windows Vista on my PC, and I will not buy Microsoft Office anymore. With this Software Craptection Platform, as you said, who knows what will happen? A problem in this crap could cause it to say you are using a pirated version of Vista, and you will be locked out of the computer if you do not pay for another license. Simply ridiculuous.

On my PC I use a Corporate version of Windows XP, so at least I do not have to worry about this crap suddenly striking me.

I bought a Macbook recently, and I use my now unused copies of Windows 2000 (and also Corporate XP) under Parallels. Works fine. No craptivation of any sort. And if I need to pass through Genuine Crapvantage, then I use these Windows 2000 VMs to get through. I say, stop paying Microsoft and search for other alternatives if possible.

By the way, I am most happy to see that Vista scales are lacking.:mrgreen:

One thing is for sure. You will see this ramp up considerably over the upcoming months and possibly years. The fact that the recording industry is considering the DRM too costly is about right but should they decide to change it, they will themselves be embroiled with the RIAA. The reason is simple. Money.

Here’s why.

Should they scrap DRM and sell the tracks, people will inevitably buy more tracks and spur market growth. However a threshold will be reached when your populous finishes buying out your track. Under this model, your finished making money on a particular song. Under the RIAA’s model, you will keep DRM thereby having a virtually unlimited number of sales of the same track and guaranteeing you money income almost forever.

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You have to revamp your whole way of thinking, so that you don’t think from the standpoint of the state and the culture, but from the standpoint of what people need and what they suffer from. Then you arrange your social institutions accordingly. – Wilhelm Reich